November 18, 2004

I'm sitting here in my local Starbuck's listening to Christmas music, and it's driving me crazy. The employees are tired of listening to people complain about the music (it started a week ago). If I had someplace else to go that offered T-Mobile Wireless access, I wouldn't come to Starbuck's until after Thanksgiving, but as it is, I'm stuck.

So I was interested to see John's comment at Brand Autopsy about the exact same subject. His blog post points to the Starbuck's gossip blog, where this is a topic of conversation.

From a marketing perspective, I just don't get it. I don't know a single individual who actually likes listening to Christmas music before Thanksgiving. We completely skip an entire holiday in the name of commercialism, and the Christmas season seems to start earlier every year. If I were running a retail store, I'd make it a point to 1) listen to what customers want, and 2) give it to them. Hey, what a novel concept. To be the only place in town that's not playing Christmas music 6 weeks before Christmas would be a huge point of difference and a great selling point. Maybe even celebrate Thanksgiving... but what commercial value is there in Thanksgiving? Quite a lot, I think. People have grown so tired of commercialism and they're longing for a return to a simpler time when friends and family meant more than buying stuff. The pendulum is starting to swing back to focusing on what's important in life, and marketers will be wise to respond to this trend. It's time to get creative about how to balance short-term profits with long-term connections with customers (which actually leads to more profits). Companies need to stop expecting customers to adjust their lives to fit the corporate agenda... and instead learn how to adjust to fit into their customer's lives.

November 16, 2004

Good post by Nick Wreden on how marketing departments must evolve to stay relevant within organizations.

The Conference Board found that the top four chief
executive challenges for 2004 were top-line growth (52%), corporate
agility (42%), customer loyalty and retention (41%), and innovation
(31%). By contrast, Booz Allen Hamilton found that marketing executives
were focused on branding guidelines (83%), counseling divisions (52%),
best-practice sharing (52%), and developing capabilities (47%). No
wonder the ANA concluded: "Marketing is disconnected from the CEO
agenda."...

The ANA study concludes that "a surprisingly high percentage of
correspondents believe [marketing's] most important contributions lie
in zones not typically associated with marketing, such as driving
innovation and encouraging cross-functional collaboration."...

If marketing wants to reverse its current dive into irrelevance, it
needs to once again be seen as the "voice of the customer." Ultimately,
that will require less advertising and PR, and more customer
communication and collaboration.

Following up my last post on Brand = Connections, I view marketing's function as "connection enablers" within the brand ecosystem, which is very much in line with what Nick writes. Unfortunately, they've been more focused on the components of their small system territory: branding guidelines, etc. More on that later...

Business has gone through so many fads: TQM, push marketing,
viral marketing, CRM… now we’re all about customer centricity: if we can make
the customer central to the organization, well, that’s the key to success. Yes,
I confess that I’ve been on that bandwagon myself, so what I’m about to say may
shock you:

Stop focusing on the customer.

Stop focusing on your product.

Stop focusing on your sales techniques.

We all want to categorize everything. We want to put each
element of business into neat little boxes. Then we can point to one element and
say, “this is the key to all our
problems.” It’s just like fad diets: first, calories were the problem. Then,
fat was the problem. Now it’s carbs. Finally, consumers are starting to figure
out that it’s more complex than that; it’s more about balance. And just as
there is no fast fix for dieting, there’s no fast fix for business.

Right now we’re focusing so much on the customer that we’ve
lost sight of the big picture. When we focus on the customer, we see a person
out there – separate from “us” – that we need to identify, label and
categorize. Companies like Best Buy are segmenting groups and assigning names.
Sure, it’s resulting in sales. Yes, it’s better than trying to sell the wrong
product to the wrong person. It's a step in the right direction, but it's not the answer. It’s just part of yet another fad that won't deliver on everyone's expections,
and then we’ll all go rushing off to figure out the next piece of the puzzle to
fix.

And that is the fundamental problem: focusing on the puzzle
pieces and not the puzzle itself. We are artificially creating separation
between the company and customers – and between different departments within
the same company – when in fact we are all part of the same system. The
customer is simply a component of that system; no piece is more or less
important. It’s what I call the ecology of business. We need to switch our
focus from components to connections. A brand is an ecosystem. The strength of
the brand is directly proportional to the number and strength of the
connections within the system. Connections,
not components, are the brand drivers.

It starts with the ecosystem's foundation: the company and its
employees. We need to move beyond a focus on a specific department (silo
mentality) to a focus on the interconnections between individuals (system
mentality).What are the most critical
connections in your company? Why not have VPs over key connections
instead of components? What about giving more power and compensation to the
individuals who are directly responsible for customer connections? The individuals
working your store or call center are the puzzle pieces that connect directly
to your customers. They are equally as important as the CEO; perhaps more so.

And of course, how could we have a conversation about
connections without mentioning weblogs? I stumbled across this long but very
good post on the subject by Colin Henderson.
He quotes Ray Ozzie of Groove Networks: “Weblogs
can help us achieve a greater ‘return on connection’ from employee, customer,
and partner relationships.” So by extending the role of ‘connection creation’ deeper
into the company, the overall system is strengthened.

(UPDATE) Finally, we should consider the connection between the brand system and
the larger social ecosystem in which it operates. We could call it
"social responsibility" (component view) or simply see it as yet
another connection that must be monitored and strengthened. Common
values provide additional points of connection between all individuals
within and between systems. It's why companies like The Body Shop
have strong brands; they see themselves in context of the larger social
system, and the additional 'value connections' between individuals
serve as reinforcements. "A cord of 3 strands is not quickly broken."

I’m trying to figure out how to post a holistic system view
I developed using a visualization tool from TheBrain. It’s very cool… stay tuned.

November 15, 2004

Only two global brands -- Microsoft and McDonald's -- actually have
what might be called global reputations, reports Ronald Alsop in The Wall Street Journal.
What's alarming (for them) is that while both score high in terms of
their awareness, neither, apparently, is especially well-liked.

Some common denominators worth noting: "In all the countries, emotional
appeal -- respect, trust and good feelings about a company -- plays a
major role. Product and service quality and social responsibility
within a community also figured heavily into the rankings across
countries."

November 09, 2004

Hugh at Gaping Void lists a number of reasons why he believes that branding is dead. I'm in agreement with a lot of what he says... I wrote about my own concerns about branding here and here and here. But as I like to say, "branding is dead; long live the brand!"

Yes, branding as its been defined (in terms of logos and tag lines) is dead. But I have yet to find a better word to summarize the idea that is formed in the minds of customers about a particular company. That idea is created by what a company says (marketing) and does (operations). Some companies have done a brilliant job in creating a consistent, powerful idea in people's minds; Apple remains my favorite brand despite its mistakes. Other companies have failed to identify how they can stand out from the pack in a meaningful way; as a result there are no mental associations -- no ideas -- created in customers' minds... and therefore no brand.

Perhaps we can use the word "reputation;" it comes the closest. Or perhaps we -- the people who are trying to kill the concept of branding as it's now known -- can bring about branding's resurrection as a more strategic, more powerful, more effective tool for business leaders. We can't just announce that branding is dead without filling the void. We can either propose a new word and leave 'brand' to the logo designers, or we can reframe the word with new meaning. In other words, we can re-brand branding. There's a contingent of forward thinkers who already driving the change: people like Johnnie Moore and the other Beyond Branding authors, fouro, Nick Wreden, Hugh McLeod and too many others to mention. As with any rebranding effort, it will take time to shift people's ideas and perceptions about branding. But hey, if a bunch of branding experts can't do it, who can? Seems like a pretty good challenge to me.

November 07, 2004

So the American Marketing Association finally updated their definition of marketing to put a stronger emphasis on customer relationships. You can read more about the change on the Peppers and Rogers web site:

The previous AMA definition of marketing, active since 1985, was:
"Marketing is the process of planning and executing conception,
pricing, promotion and distribution of goods, ideas and services to
create exchanges that satisfy individual and organizational goals."

The new definition of marketing, unveiled at the AMA's Summer
Educator's Conference in August is: "Marketing is an organizational
function and a set of processes for creating, communicating and
delivering value to customers and for managing customer relationships
in ways that benefit the organization and its stakeholders."

The article quotes several experts who say that that the definition is a reflection of what's already being done; I disagree. Yes, companies are more customer-centric. Yes, marketing departments are already playing critical roles in building customer relationships. But I think the key phrase here is, "marketing is an organizational function." I don't know many companies that have truly integrated marketing as a mindset throughout the entire organization. This definition sets the marketing executive in a more pivotal role in a company; he/she is no longer simply responsible for a department, but for "delivering value and customer relationships." It's up to marketing to work with other departments to ensure that -- from promise through delivery -- the customer experience is consistent and positive. So while the AMA is a bit late to the party, it offers up a definition that holds a lot of room to grow.

What do you think about the new definition? Does it go too far, or not far enough? What does the future hold for marketing?

November 05, 2004

I think the role of business is to make the world a better place for
everyone. We're going to do that by giving people choices, giving them
self-esteem. But fundamentally, we'll do this by including the 2.3
billion people who exist on less than $2 a day, and turning them into
active participants in a free, capitalistic, choice-driven,
self-esteem-driven market.

Ok, let me make sure I understood that: Self-esteem comes from buying crap we don't need. Got it. Wow, this has been the subtle message of advertising for decades, but no one has so clearly articulated it before. Thanks, Kevin.

I really enjoy the articles and case studies on
MarketingSherpa.com. I give them my vote for the most useful marketing resource
on the web. Their latest report is called How B2B
Buyers Use Search; you'll get a survey recap plus a free PDF download
of a study done in conjunction with Enquiro Search Solutions. Pretty
interesting stuff.

Although Google only has a 36% share of the total online
search usership according to comScore data from earlier this year, 82.9% of
surveyed business users said Google was their search engine of choice.

54.6% of respondents said they used search 30-90 days prior
to authorizing or making a particular business expenditure. This means search
is your first line of defense near the start-mid-level of the sales cycle.

Once again search users have confirmed that 69.6% of the
links they click on are ORGANIC and not the paid ads. (This percent rises to
76.7% if they are Google users.)

This last stat is great reason for starting a blog, since
Google's page rankings are based on inbound links. (And if you're new to the
blogosphere, blogs are built on links; they're network hubs.) I'm always
astonished at my page rankings for the strangest Google searches; today I noticed that I'm the 5th listing under "Google company" out of 8.6 million results. Here's a great way to see the total number of links to your web site or blog: MarketLeap's Link Popularity Check.

November 02, 2004

Thanks to Bob Cargill for the link to this article in DM News that bashes blogging as a useful form of marketing for businesses. The author writes:

I have yet to find a single marketer who says that a business blog has gotten him a positive return on investment...

There are two major problems with blogging as a business-building tool.
The first is that most blogs I encounter are rambling, streams-of-consciousness musings about a topic of interest to the author, largely bereft of the practical, pithy tips that e-zines, Web sites and white papers offer.

The second problem involves distribution. With an e-zine, once the reader subscribes, he gets it delivered to him electronically every week or month or however often you send it. But with a blog, the reader has to go out and proactively look for it. And since your contributions to your blog may be irregular and unscheduled, he has no way of knowing when something new of interest has been added.

...most blogs seem to be the private, idiosyncratic musings of an individual, without censure or editing of any kind. And the result is like porridge: a gloppy mess, tasteless and not very satisfying.

Obviously this writer didn't do his homework. Yes, people make money from blogging. Hmm, rambling streams of consciousness with no practical tips... my Bloglines account is crammed full of the most interesting authors I'd ever want to read. And speaking of Bloglines, the author clearly hasn't heard of RSS feeds and how that's transforming content distribution. I could go on and on, but I won't.... since you, dear reader, obviously know the truth of blogging. How we get the word out to the rest of the world is another issue...

I have one idea for Google that I think makes sense given their company mission, which is "to organize the world's information and make it universally accessible and useful." I'm always frustrated by the need to fill in my medical health history every time I go to a new doctor/dentist/optician. Wouldn't it be great if Google would allow me to fill in a medical history form that they store in their network, together with security settings that allow me to control who gets access to the information? In addition, they would provide a web services API that allowed vendors with security permission to access the information...

The revenue to Google would be in the billions, according to my rough calculations. Of course, the same model could be applied to storage of a person's address (useful when moving), travel preferences (useful to travel companies), resumes (useful to companies that want to hire) etc. The fact that people are already trusting Google to store their mail (Gmail) means that their brand is already evolving to earn the public trust for this undertaking.

Many analysts say that Google's overvalued because it has an advertising-based revenue model. Perhaps today it does, but its brand mission -- and its back-end infrastructure -- goes well beyond what they're doing today.

This is one of the few company mission statements I've seen that I like. It's both focused and grand in scope; there's no BS language like "leading provider of x category". It lays out a clearly defined path with no end in sight; employees can take this mission and run with it. Any new product idea that organizes and searches information is fair game and fits within the overall Google brand.

How does your company mission stack up? Does it provide clear parameters while allowing future growth and evolution of the brand?

November 01, 2004

To preface this post, I must say that I have a lot of respect for Nick Wreden. His book Fusion Branding is a terrific overview of building strong brands that are NOT dependent on traditional marketing. We share the belief that brands are built by organizations, operational excellence and customer experience, not by advertising. It's the first branding book I've read that goes into detail on supply chains, technology and pricing. I absolutely recommend it.

All that to say, I'm surprised by Nick's blog comments on Apple Computer's 1984 TV spot as "the worst ad ever made." He says...

First, it set Apple on the downhill path that made it an also-ran in the computer market for so many years. At the time the ad ran, the computer market was a dog-eat-dog battle between Microsoft, Apple and CP/M. Corporate America saw the ad, thought hey, Apple doesn't like us, and began to standardize on Microsoft....

Second, it was a one-time ad.... Single ads are a waste of money; only advertising campaigns can be effective.

Finally, it spawned this myth that the goal of advertising was to "break through the clutter" by pushing the envelope... A better goal for advertising -- generate measureable profitability.

Wait a minute... these comments are written by the same man who says that brands are built by operations, not by advertising? There's no way that this ad "set Apple on a downhill trend." It's not about the advertising.

For the real story on Apple's downfall, read Fast Company's cover story from January on Steve Jobs and innovation. There are a laundry list of executive decisions that drove Apple into niche-player status, including a closed operating environment and an obsession with controlling the entire process of innovation. "Fewer developers mean fewer new products to run on Apple machines. That means fewer options for end users, which influences purchasing decisions, and therefore sales and profits." Corporate America didn't standardize on Wintel because of an ad.

The purpose of the 1984 spot was to create awareness. It accomplished that goal admirably, and spawned legions of Mac lovers. It probably generated more ROI than any other ad run. It's not the advertisement's fault that the company made decisions that stunted its growth. Let's not put so much weight on advertising to make or break a company. No advertising, or even bad advertising, is not going to damage a company that's doing all the right things in terms of operations and customer experience. Based on the Fusion Branding book, I think Nick would agree...